Skip to main content

tv   Squawk on the Street  CNBC  March 13, 2017 9:00am-11:01am EDT

9:00 am
could look beyond their own selfish interests. look, chuck schumer, i have a great affection for what he did for me at the medical center. chuck schumer needs to take a step back and say wait a minute, how do i show my constituents and the american people that at the end of the day i want the best for america? if the idea comes from the other side, i'll embrace it. that's all. >> anyway, thank you. >> thank you, thanks for having me. >> make sure you join us tomorrow, squawk on the street begins right now. good monday morning. welcome to squawk on the street. at the new york stock exchange. we kick off a big week today. a fed decision. a white house budget. a cbo score on health care and a lot more. futures are pretty tight as the s&p broke that six-week winning streak. prime minister may could hit the button on article 50 tonight.
9:01 am
oil hit 48.11. that is the lowest since november. wall street's top cop fired. the trump team ousted obama appointed u.s. attorneys and the political fallout that could follow. intel is buying mobile i for $15 billion in cash. what's behind this big bet on wireless? >> and the big east bracing for a big storm that could bring up to two feet of snow in some areas. wheat get a live look at preparations and what to expect. u.s. attorney preet bharaha asked to step down along with 45 other u.s. attorneys appointed by president obama. just weeks after the election, he met with the president-elect at trump tower and agreed to stay on the job. he tweeted, i did not resign. moments ago i was fired. being the u.s. attorney in the southern district will be the greatest honor. guys, you both know him very well. we'll listen to some sounds in a
9:02 am
minute. what does all this mean? >> everyone serves at the discretion of the president. i just think they definitely got their signals crossed here. preet got a handshake deal with trump. now maybe things have changed. does preet have political ambitions? i think he's never hidden he has political ambitions. he doesn't want to get out of the limelight. this is a man who wants to serve. obviously he brought a huge number of insider trading cations right before he was fired. he just got higher court approval really going after some guys that had been dropped. so this was not the right time for him to go clearly but maybe there is no right time. paul fishman, a buddy of mine from jersey, he was let go. he was doing a fabulous job, jersey. this is the way it works. >> this is typically the way it works. bar rar ra had a successful tenor, i think it would be fair to say. towards the end, particularly that case involving steinberg
9:03 am
and the law about tippers and tippee. things may have been turning a bit in terms of the difficulty of getting an insider trading conviction. he had a long line of them. quite significant. although one name of course did elude him that we all know about. steve cohen and the back and forth there. >> right. >> but generally speaking, certainly a well regarded u.s. attorney. >> yes -- >> in terms of his focus on not necessarily the banking industry though. one area where some people criticize overall, jim. we talked about this so often. the fact that so few, if any, of the executives who potentially led us down that path actually ever saw jail time. >> well, the eastern district lost that case against the two people. and i feel -- >> the hedge fund. >> i believe it was directed by washington to not go after -- i think that the holder justice department said listen, guys, we don't want anybody freelancing here. that's important to point out.
9:04 am
i do think he was the most high profile of the u.s. attorneys. i think he was very apolitical. i never saw him -- look, his last case was de blasio so -- >> although ambitious, what's the old line, somebody asked him what his district was. he said maybe if you're familiar with earth. >> look, the guy's never hidden that he's an ambitious guy. i think what matters is he brought a lot of -- very successful cases. he had had that last one overturned. he just got higher court approval. i think he was going to strengthen -- the nexus. it was always about the nexus. what do you do when you get the tip, when you give back? and there was this -- preet had taken this very expansive notion, if you could get into a club or if you could have something that was not necessarily remunetive, the dollar amount. preet was saying that was enough. i thought he was dead right. >> heightened awareness in
9:05 am
dealing with material, nonpublic information, even among hedge funds who didn't necessarily have it, just under the perception they might have it. and that's the impact to him i think. right or wrong. perhaps going too far in certain areas. >> discretion. >> yeah. >> you did ask him about whether -- what institutions are too big to go after. >> right. >> here's what he told you at delivering alpha. >> the point of prosecution is not to give everyone who commits a crime the death penalty. in our system, that apparently is still permitted in certain cases. that's true with financial institutions also. the point i was making last year and the point i made throughout is that no institution is too big to jail. that does not mean depending on the nature of the conduct that you're trying to put a company, whether it's a bank or anyone else, out of business and cause people to lose their jobs and roil the economy. >> to your point. >> right, that's the arthur andersen.
9:06 am
you just don't wipe out a company. i think that -- there was a $21 stock preet and i talked about that was just a glimmer of the eye. i asked him whether hedge funds were going to be a snap. message disappears. seemed at first he wasn't familiar with snap. >> i remember this. >> i think that may be because i had two teenagers and so they were snapping away. >> i will tell you this, whatever he chooses to go into, whether it's politics or private practice. he also could potentially have a tour on the comedy secret. >> yes. >> people do not realize perhaps just how funny. >> funny and i think a book would certainly be of interest. i think that you're going to see a lot of preet. a lot of people say hold it, didn't he work the tweets about that. honest to god, the guy was the only guy who just got the green light from trump. so wasn't like he was preparing to leave. everybody else by the way in the network, everyone else knew they were going to be fired. i think this guy was the only guy who actually met with trump.
9:07 am
trump said you're in. i know this -- >> apparently some phone call was made on thursday. he did not take the call but it was from the president's office. >> which is considered a breach of protocol in d.c. circles. >> right, exactly. >> more on bar rar ra later on in the morning. shares of mobile eye moving, surging in the premarket. intel agreeing to buy the provider for more than $15 billion. a 34% premium to the close on friday. both companies already have a partnership with bmw to put about 40 self-driving cars on the road in testing mode. stay tuned for first on cnbc interview with intel's brian krzanich today. biggest deal pretty much for any israeli firm? >> i think this is a fabulous deal. intel had a partnership beginning of july last year which was with mobile eye and they were teamed up to work with bmw. brian krzanich told me -- it wasn't that long ago, it was
9:08 am
actually three weeks ago, that he felt this is where you have to be, autonomous cars. he felt i was a little misdirected liking nvidia so much because nvidia is obviously the other player. the third player is google. people don't understand waymo is their own chips. but this is a big deal in order to be able to get kryzanich to where he told me there are more chips to be per person. that's the number. he said autonomous car puts as much data as 3,000 people. put a million of those cars on the road. he was trying to get things going beyond data center, which has just been okay. his internet of things business has been very strong. obviously the pc business has been flat lining. a huge move. i can't wait to hear your interview. because brian wanted this market very badly. now he has it. >> calling it a data center on wheels. >> exactly. >> that's what they call it.
9:09 am
you can imagine giving the statistics you shared as to why they want to be in there, jim. you've been somewhat critical in the past. >> of intel. >> yes. brian came on and said -- >> they did bio terra. now buying this. diversifying revenue base. >> he told me, we are not the way you think. we are moving. and i -- yes, i questioned the company because i felt terra was an okay acquisition, not perfect. this is a perfect acquisition. this market is just -- not going away, it is accelerating rap rapidly. >> where does it place intel in the race with uber and tesla and gm? >> well, a lot of these guys use mobile eye chips. >> right. >> what i think i would say is mobile eye, theoretically, intel has fab ability. i would say all -- everyone is
9:10 am
going to be scrutinized, whether you use mobile eye or nvidia. mobile eye has a lot of really good partners. this puts intel at a level which tells me -- i mean, intel stock is down and it's kind of stupid because the cash was doing nothing for them and now they have accelerated growth. the models will change. intel down because people don't understand what the heck intel is doing which is as dumb as wood but that's okay, people are wrong a lot. he said he wants to grow the company faster and he just did. >> couple of quick deal points. 63.54. all in cash. cash that was sitting there. >> yeah, it's not like an arbitrage. >> so there's no financing condition or anything like that. they're talking nine months for close. there's some question. the call began at 8:30. i don't know the answers to whether they might need shiny's approval. that can tend to take longer. if you want to start to go down that road and imagine there are going to be rising tensions in terms of trade between the u.s. and china, well, that can become
9:11 am
even more important if you do need those kinds of approvals. not sure if that's the case here. north america, they do about $155 million in revenues. uk, $42 million. obviously the u.s. is still the bulk of the revenue. it's not expected to see any other topping bid. i believe the all-time high for the stock. which went public not too long ago. >> remember, they had a tiff. we never found out what the real issue was. they had a tiff with elan musk and that's what sent the stock down and made the stock i think suspect because a lot of people feel elan musk. our products have been up, this is an old statement from -- you know, their key clients include bmw, ford, general motors, nissan, volvo, audi. i would question audi because that's really an nvidia customer so be careful there.
9:12 am
but mobilize a little aggressive saying who their biggest clients are. this is intel making the move. people are sending the stock down because people think intel has not been historically good at acquiring. they'll figure this out. i don't know, sold it because i was stupid. there you go. >> talk to him in the 11 a.m. hour. the northeast is bracing for this massive storm with blizzard conditions set to hit the region early tomorrow morning. meteorologists say the storm could dump up to 20 inches of snow. with wind gusts of 40 to 50 miles an hour. jim's trying to figure out how he's going to do mad and then us and then mad again. >> well, it could take 5 1/2 hours to get from here to inglewood. plus, i could probably get to i don't know lisbon quicker, definitely rome, right. i could get to rome by the time.
9:13 am
>> the only thing i would ask is governor cuomo, do not think about closing or shutting the subways, all right. >> i'm bringing pajamas. i'll sleep right here. then i'll sleep right there. in the end it won't even snow and people will say why didn't you take a shower. >> when we come back, a civil war on trade. more on the competing interests that we're hearing about inside the white house. more on the fallout from the firing of preet bharaha. the premarket, the s&p still on track for the best quarter since the fourth quarter of '15. alpha seems more elusive today. is it because so many go after it the same way? chasing after short term returns. instead if getting caught up with the crowd, the investment managers at pgim take a long term view, teaming specialized active investing with risk-management rigor,
9:14 am
to seek out global opportunities. we manage over a trillion dollars this way, attracting many of the world's leading investors. partner with pgim. the global investment management businesses of prudential
9:15 am
9:16 am
a white house civil war has broken out over trade. a fiery meeting in the oval between economics close to the president and more trade moderates from wall street. pitting them against national economic council director gary cohen and during the meeting the president appeared to side with the economic nationalists. hard to read into these things. people still, though, talking about what cohen told us on friday about deficit neutrality.
9:17 am
>> yeah, look, these are very -- they're internesting. trade is a very important issue. the fact that cohen would perhaps be seening an ing aas s not push hard on these policies. not surprising given those of us who know him. beyond that, you'll have -- the journal today has their story, about growing tension between the white house and congress. >> yes. >> certainly some congressman from rural districts that have benefited from nafta on the agricultural front are starting to become somewhat concerned. this will be an important issue. we've heard about the idea of rising protectionism and how good or bad it will be. the border adjustment tax pays into all this as well. very interesting y, you know, i
9:18 am
wouldn't want to mess with gary cohen in a close quarter area. >> big guy. >> he can take them. >> don't want to be on that side of the trade. >> yeah. pretzel quick. >> cohen made some more comments to fox over the weekend. namely about the cbo score. which he said in the past the cbo score has been largely meaningless. mulvaney seemed to back that up this morning. or on abc. then they talk about the fed. cohen saying we respect the powers of the fed. doing a good job even if they do hike this week. >> i know there's -- there were statements in the campaign which would indicate there was not going to be as much independence for the fed. >> no. >> that seems to have been walked back. >> i think it's interesting cohen seems to be the voice for economic policy. steve has done -- i believe an interview with becky quick, but we have not heard from him as much. >> no, it looks like tax reform, trade, fed, all of these kinds of things.
9:19 am
>> cohen's out there. i think cohen's out there in a way that says don't worry. everything's going to get done. when he's on, he can move ma markets. >> if the president is siding with them, if the ft is right. >> kudlow insists it's the opposite. things like border adjustment are losing steam. but cohen has been painted by multiple reports as the adult in the room. i think is the headline. >> well, i know that the border adjustment, if phased in, is beginning -- i still feel has some -- some push. i think that the phase -- >> the way stteper was talking about it when he did that interview last week. over a five-year period. a dollar would ajust a decent amount initially. there would be a benefit because you'd only phase in the 20% over time. you'd only phase in the border adjustment tax over time. >> but the retailers are obviously quite concerned. there's 100 stores.
9:20 am
it was a sun deal. it was $8 as recently as a year and a half ago. just be aware the retailers themselves, i don't know how much cloud they have. they're going to say listen, we are so struggling. this could really do it for us. we have a lot of layoffs. you get the other side of the trade. it's important because the retailers have gotten into me saying do you understand how dire it is for us even without this. so be aware of of that. >> we had ellison from jcpenney saying that last week. with didn't get specifics as to why it would make the company unpopular. >> well, the $2 store, they have to charge $2 now for my faux ray-bans. >> you would never know. >> we've seen your wallet, we've seen your -- you basically emptied your whole backpack. >> one time or another. not the medicine chest yet. that will come. >> we'll get cramer's mad dash. we'll count down to the opening bell in a moment. don't forget, intel, on that mobile idea later on this morning. intel fighting hard to get back to the flat line premarket. more squawk on the street in a moment.
9:21 am
9:22 am
hey gary, what are you doing? oh hey john, i'm connecting our brains so we can share our amazing trading knowledge. that's a great idea, but why don't you just go to thinkorswim's chat rooms where you can share strategies, ideas, even actual trades with market professionals and thousands of other traders? i know. your brain told my brain before you told my face. mmm, blueberry? tap into the knowledge of other traders on thinkorswim. only at td ameritrade.
9:23 am
time to start off the week with a mad dash as we count down the first trading session of the week. >> some calls i love. this morgan stanley call i love. morgan stanley was boom, really, really behind boeing right here. okay, just saying, don't give up the ship, big buyback, lots of orders. those leaving it will miss a giant move. and it caught a giant move.
9:24 am
it's moving now from buy to hold. i think oftentimes many years when we talk what we're always looking for is someone who got it right who then says okay, it's been a big look. they're saying there's still terrific stuff happening on boeing. earning's potential's unchanged. they say on balance the risk/reward here is not as strong. i happen to agree with this call. i think the united technologies is the one to be in at this point. i spoke to craig haze on friday. he was bullish. ceo of united technologies. just saying all this division, particularly otis and carrier. >> ev that been concerned about otis in the chinese market. >> he said china's good but the u.s. is much better. he said something's happened with his orders in the last couple of months. for both carrier and for heating ventilation air conditioning and for otis in this country. and he said look, i can say trump, i can say -- >> maybe. >> but there's just a surge of orders. so yes, i think boeing always
9:25 am
had a great move and i really like boeing but people should look at united technologies. broke a lot of news in my interview. >> we'll talk more about that when we get to the other side of the bell. we'll keep an eye on it. stay with us. we start the week trading in just a few minutes.
9:26 am
say carl, we have a question about your brokerage fees. fees? what did you have in mind? i don't know. $4.95 per trade? uhhh. and i was wondering if your brokerage offers some sort of guarantee? guarantee? where we can get our fees and commissions back if we're not happy. so can you offer me what schwab is offering? what's with all the questions? ask your broker if they're offering $4.95 online equity trades and a satisfaction guarantee. if you don't like their answer, ask again at schwab.
9:27 am
please repeat the objective. ♪ thrivent mutual funds. managed by humans, not robots. before investing, carefully read and consider fund objectives, risks, charges and expenses in the prospectus at
9:28 am
you're watching cnbc squawk on the street live from the financial capital of the world. a busy week, the highlight of which, i assume, jim, will be the fed meeting, even though exec it tations are close to 100%. >> i think a lot are looking for the word gradual to be removed. if you get gradual removaled and you get some sort of normalizing, some statement like that, then i think you get a quick sell, because they'll be a lot of people say wow, okay, flower what really in a rate hike cycle. they'll be other people who say the next day, hey, this is i great opportunity to buy bank of america. so be aware this is a very tough week. because there's such a thicket. we've had a lot of tough weeks since trump was 50 electric ele. with tend to get through them. >> oil, we mentioned earlier, got close to 48.
9:29 am
close to mid-40s. >> i think you'll see maybe down to 44. this is really about the inventories. the inventories is so, so big. you got to put that oil somewhere. we don't need it right now. the balance has to sort out before you can find a -- find some sort of equi lib brie yum. and now oil's inventory's the highest it's ever been. ek speculators dead wrong, dead wrong. >> michael buffer on behalf of msg. >> ladies and gentlemen -- madison square garden new york city usa middle weight championship of the world. let's get ready to rumble.
9:30 am
>> how do you follow that? >> he should ring the bell every day. well, let's get ready to rumble. there's a real estate investment -- the opening bell. could be a good fight, by the way. that guy's got a great -- he fought off cancer successfully. >> two thumbs up. he has a lot of things that are patented, right, that you can't use, ready to rumble, i understand that's his. the fight is saturday live on pay-per-view. there's the bell at the big board. you know who's ringing. at the nasdaq, it's hebron technology. a maker of specialized valves and pipe fittings. >> some great advertisement. i think cnbc ran that whole ad. >> yes, we did. did a great job. >> coming back on every week now -- >> exciting. i've not been to one of those fights. maybe this is -- tough ticket. triple g is a big favorite.
9:31 am
he's a big favorite. >> what? >> yeah, he's a big favorite. >> you got to root for jacobs, he's a new yorker. >> that's easy. >> intel is going to open in the green, jim. >> there you go. people are as dumb as wood to become eventually plywood and then the next thing you know they're on the lender, our show, the deed -- >> the deed. >> which by the way is so much fun. because there's daylight savings time, at 4:00 m an shg a.m., th this deed. why don't they list this guy? he's a genius. you got to watch the deed. it's not an ad. i happen to like real estate. it's like the guy, i want him to back me, i'm ready. >> they're not unhappy with that, intel. they're not seeing any real reaction to their stock. >> when you hear how much there is just intellectual property and how intel and mobile do it and brian is a very good spokesman for the future. so when you listen, i think
9:32 am
you'll say, hey, you know, what, they're going to own that market. maybe nvidia, a little tug-of-war. i think he's a little tired of hearing about nvidia. certainly from me. >> we have not seen that many mondays with large deals. i mean, the pace has been okay. what i hear is expect a very busy second half. >> really. >> we're in the middle of march now. it has been a reasonably okay year. some of the totals have been all right. >> the merger monday doesn't happen. so you come in tuesday. >> i will say there's got to be some banker at raymond james high flying everybody in the halls because they advised mobile eye. >> raymond james. >> they got that going for him. >> israel deal. >> raymond james going into the s&p 500 along with amd. >> amd can't do anything wrong it seems right now. just everything right. >> some new market cap guidelines means urban's going
9:33 am
to come out along with -- frontier and first solo. >> frontier, i don't know. people reaching for that yield. it's just such a bad idea. the urban call conference call was so bad. where richard lahayne just told you we're not making money online, it's killing our regular business. understanding of what's going on in retail now. >> now a quarter of all outstanding. >> what does that say? >> you know what, i don't know. >> idk? giving me an idk? >> i got nothing. >> how about an icm-1. >> sure, i missed it too. >> he did disclose. >> bought about $19 million worth after the stocks had back l a rough two months. >> the quarter was not a blow out quarter. the quarter was an weak quarter. there is an earnings component.
9:34 am
it's not just icon versus -- you know, it's just a real company -- >> a lot more interest in his ownership of bmy which you've never seen detailed because it's not a filing in any way. what if anything will happen there when it comes to mr. icahn of course? >> whether he will push anything on bristol and whether there's interest of potential buyers. >> very good point. a big company. cancer franchise had a real setback. >> yeah. >> insight by the way, a lot of stock filed. a lot of people felt gilead. the rumor was gilead would buy insight in order to get things going. >> have we confirmed the baker brothers -- >> they filed. >> they filed 34 million shares. credit suisse. >> they're very well-known investors. but i would note they filed
9:35 am
something called seattle jen anytimics last october but never sold. just filing to sell doesn't necessarily mean you are selling. >> it's that important. yeah, like chipotle. he filed to sell. >> but is insight down on that news? >> i don't know. it's interesting, invid ya is up. i think that's a statement which says that is the area to be in. not that nvidia is going to be taken over. look, david convinced me, autonomous driving cars are big. i was in one in california. yes, i mean, we're clowns versus the people who run the mind of that car. we're clowns. we inched up to the stop sign. remember studyinging how to do it? everything you study, they do. and they don't drink. autonomous cars, they don't drink. >> they don't text. >> they don't text. they don't drink. that's why they're better. >> they don't watch movies while they're driving. i've seen people watching movies while they're driving. >> they don't run red lights. they are better than we are. you would never have had a car
9:36 am
run by a human if you had autonomous from the beginning. >> you've got a lot of focus, a lot of money and attention on this now. no doubt about it. as you say, waymo. google has its own chip set. mobilized. >> i think way mo's very ahead of everybody. that's the fiat. they got a deal. >> we going to be sitting here talking about google and another important business for them as opposed to something still considered -- >> advertising? two years. two years. take a look at the engagement numbers they have in california. go to the website. i mean, they're almost fool proof. now, obviously everybody knows if there was ever something that went wrong, people would freak out. >> well, look, we had one fatal accident -- >> that set it all back. >> i know. but 1 million people die every year from car accidents. i mean, you know, it's the 747 -- >> in the world. >> there's whole countries that are far worse than us. but we're moving back up. the insurance is going to get
9:37 am
very prohibitive. >> what was the piece over the weekend? if a professor who poses the option, if i gave you a technology that would make life so much better for so many people but it would cost you 1,000 lives a day, would you take it. that's the car. that's the car. >> that's the car. >> wow. >> it is. >> very compelling. >> at 15 billion, s&p says it is the top global tech deal of the year. >> el with, look, it's a company that, again, when they had that tiff with musk, you thought that maybe something's wrong with their technology. they were adamant, saying absolutely nothing wrong. they do have a lot of customers. every auto company has to be involved. if one breaks out here, they'll get all the customers. because there's 20 million people who are disabled who can't drive. remember, elderly can't drive. this is a very big idea for 20 million people who would go back into the universe of car drivers.
9:38 am
this is a big market. intel wants to dominate it. >> right. >> talked about it so often in terms of what it means for employment. >> ooh, yes. >> you could make your own arguments about technology, displacing jobs, that then create new jobs. but sometimes there's also a displacement that takes years to fill. right now, there's a lot of people who drive for a living as we talk about these things and we talk so often about the president's policies to try to bring jobs back. this is not far away. this is only a handful of years away we start to see these cars on the roads. >> mobilize. really good technology. really good truck technology. truck drivers. they have -- go long hours. >> what do they call it now, platooning where one truck has the driver and the others are robot driven falling behind? for long hauls, that's an extremely efficient way. >> if you go to mobilize site, they have a lot of good stuff about what they do. i looked at the wheb site many times. it's been a hard stock to recommend. it frankly has been footballled
9:39 am
so to speak. depending upon how people feel about it on a given day. well, they're now done. when you speak to bryan, bryan will tell you this is the biggest chip magnet. i mean, it's like a magnet how many chips. >> not a chick magnet. >> not a chick magnet, it's a chip magnet. chick magnet is not something you say anymore. that's very inappropriate. a chip magnet is very good. you can ask him. he's very funny. he's very dry. he loves drones. he's been interviewed on redit. he may be the coolest guy in the valley. he is cool. brought his wife with him to the set last time. made it very clear that, you know, maybe i should be a little more respectful. i said, listen, i've always been respectful of intel. i just don't want it to be pcs and data center. and internet of things. well, boom, it's not.
9:40 am
it's bigger than that. bigger than u.s. steel. >> it's not hard to be bigger than u.s. steel. >> intel is the dragon the dow. let's get to the floor. welcome back, bob. >> thanks very much. 20 pesos to the u.s. dollar is certainly helping the tourism business in mexico. let's lack at the markets. three weak sectors are helping. that's good news because energy's had a horrible month. you know what happened last week. materials industrials really haven't done much at all either. they're still on the downside. tech's been your stalwart. that's why the market's still up. because tech's perform eing wel. in the last week, things have gotten a lot more bifurcated. tech, health care and financials are up. those are the three biggest sectors. that's why the s&p 500 is up. everything else is basically down, including interest rate sensitive groups including utilities. energy is down as well.
9:41 am
some talking about the collapse of extended long positions in oil. that's been a major topic of discussion over the weekend. more troubling to me is the decline in the transports and particularly the russell 2000. if you look at the markets so far and what we're doing so far this month, the nasdaq and of course the s&p are up. but we're down $1.5 million in the russell 2,000. it's a little bit worse than that because you don't -- it's better to look at it from the recent highs. so the russell 2,000 from the recent highs is down about 5%. the s&p 500's down two. the nasdaq's only down 1% here. so remember something. a lot of this was based, these tax cuts and reduction regulations. the assumption was small caps would be the biggest beneficiary of them because they get hurt by the large amount of regulations. there are some doubts about that. i don't know why. i think they would be helped. that's the concern going on right now.
9:42 am
let's move on here and take a look. i think it's interesting that, you know, they've had a horrible year. of course copper's been down. they've been down about 6%p on the year but they rallied nicely today. there's been a lot of supply disripdi disrupti disruptions. the biggest mine in the world, there's been a strike there. they haven't been able to. conference stocks are on the up side. the pipeline for ipos is opening. the r dog group which makes glass containers should go public on wednesday. canada goose holding which is a big maker of trendy outer wear, parkas, expensive parkas, should be going on thursday. pricing wednesday for thursday. and mule soft business enterprise software company, trading for friday. three companies, all decent
9:43 am
sizes. respectable companies. we're still waiting for a real explosion. i anticipate maybe the second week of april, somewhere around the easter holidays, i think the calendar is going to get a lot more crowded. we'll have at one point eight, nine, ten ipos. that's when i'll be able to say the ipo market has finally come back. still waiting for that one. right now the dow down 16 points. >> all right, bob, thanks a lot. check in with rick at the cme group. >> the dynamic of what's going on with rates not only treasury rates but rates in europe and to some extend other major sovereigns continue to creep and if they don't creep they hug. and it's kind of exactly what's going on. equities with a different perspective. stocks may not be going zoom, zoom, zoom every day but they've done a lot of zooming and they give very little back. so kind of the -- you have to pay attention to ranges. open the one-week chart on the two-year which you can see
9:44 am
hugging the, getting close to 140, still hovering at june 2009 levels. one week of tens just as fascinating. one week chart, you see the high yield intraday was 262. if you go back to the next chart september 14, that is a key area. but another key area that we're playing with here is the december high right around 260. both of those when you add in what's going on today are something to pay attention to. you know that old rule, you know, three times, knock three times. third time markets tend to go through significant support and resistance levels. we want to pay attention on the closing basis. one week of boons. certainly they're getting close to 50. but they're not like the ten-ier at 260. but it has come quite a ways. if you open the chart up, we're toying with the highest yields since early 2016. and finally, you know, just a couple of days ago, we're talking about how many were short the euro and long the dollar. no matter what reasons you think will make that trade work, the timing was off.
9:45 am
we say maybe you'll see 108 the euro versus dollar. wow, we certainly are near that 107 handle apparently quickly. remember that dynamic. lo logistics are maybe sometimes more important than timing on the fundamental issues that move markets. carl, david, jim. >> all right, rick, talk to you soon. it is the deal of the day, intel buying mobile eye for more than $15 billion. stay tuned, intel ceo will join us first on cnbc. pandora ceo tim westergren. launching premium music streaming service today. dow's down 12.
9:46 am
liberty mutual stood with me when i was too busy with the kids to get a repair estimate. liberty did what? yeah, with liberty mutual all i needed to do to get an estimate was snap a photo of the damage and voila! voila! (sigh) i wish my insurance company had that... wait! hold it... hold it boys... there's supposed to be three of you... where's your brother? where's your brother? hey, where's charlie? charlie?! you can leave worry behind when liberty stands with you. liberty stands with you™ liberty mutual insurance sometimes they just drop in. always obvious. cme group can help you navigate risks and capture opportunities. we enable you to reach global markets and drive forward with broader possibilities.
9:47 am
cme group: how the world advances. hello, my name is watson. i am helping 8 million taxpayers get the largest refund they deserve. one million people can benefit from precision cancer care. 197 million passengers can fly with less turbulence. i am on my way to working with one billion people. i look forward to working with you. i am on my way to working with one billion people. ♪ oh! the things you say ♪ ♪ oh♪ ♪
9:48 am
♪ ♪ you're unbelievab♪e ♪ you're unbelievab♪e the northeast bracing for a
9:49 am
huge storm that could dump two feet of snow in some areas. let's get to paul goodloe in philadelphia for the latest. >> we have good news in this forecast here. we have kind of backed off the bullish forecast. even this morning and last night, we're thinking 12 to 18 inches of snow from here in philadelphia, even down towards d.c., up through new york city. we've backed off a little bit. as that low's going to come a little closer to the coast. it will cut down some of the immediate i-95 snow totals. still, this is going to be a significant snowstorm up and down the eastern seaboard. d.c., while the district center city might get maybe to 6 inches out to dulles, the northwestern suburbs still a foot of snow. baltimore, 8 to 12 inches. in philadelphia, new penance mall, you do have constitution setup behind me and also by the way independence hall where they signed the declaration back in 1776. this entire area, green grass
9:50 am
you see now. this time tomorrow we could have snow falling maybe 1 to 2 inches of snow per hour. we're expecting, again, maybe close to a foot of snow. 8 to 12 inches is the forecast here for the philadelphia area. but it's not just the snow. which also extends all the way through new york city, long island, up towards boston, where they're actually in a blizzard warning for new york city. almost 20 million people under wl blizzard warnings. we're concerned with the wind giving us blizzard conditions. philadelphia, not under a blizzard watch or warning yet. that could change. some of the jersey shore counties. but we could still see winds howling, sustained 20 to 25 miles per hour with that snow blowing side i whats, making travel difficult, if not impossible at times. it's coming in tonight. winter storm warning starts at 8:00 p.m. tonight. goes until 6 p.m. on tuesday. we ekt xpect the bulk to start 10:30, 11:30 tonight. go all night long and through
9:51 am
the morning hour, before tapering off into the afternoon. that's where we'll have that 8 to 12 inches. with the wind blowing that entire time, getting even stronger as we get towards sunrise tomorrow. with that blowing and drifting snow. that's not just an issue here in philadelphia, it's up and down the eastern seaboard. starts in really d.c. then up towards baltimore, philly, new york for much of tomorrow. even boston tomorrow night, they'll slowly be winding down this latest nor'easter winter storm, carl. >> paul, thank you very much for that. priceless shot of the city of brotherly love. >> boy, that is a fun place. i love that. that is one of the -- people who have been to philadelphia other than going to gino steaks, you should go to independence hall, fantastic. i remember growing up it was just a bunch of little stores. i couldn't believe they were on like thomas jefferson -- like where he worked, you know, some hot dog stand. so it's good they cleaned it all up. >> yeah. maybe this is the last gasp but certainly we talk about natural
9:52 am
gas on this show every now and then. temperatures have had -- february was strange, right? >> they needed it. the natural gas, other than what's being shipped overseas, natural gas is -- they just never got the winter. so that's one of the reasons why natural gas -- one of the reasons why chesapeake, southwest. people say you like these stocks. el with, this was the warmest winter. you can't -- you need really, really cold winter for this thing to work. >> yep. >> we'll talk more about that and some other things going on. we'll get stock trading in just a minute, don't go away. ♪
9:53 am
can i get some help. watch his head. ♪ i'm so happy. ♪ whatever they went through, they went through together. welcome guys. life well planned. see what a raymond james financial advisor can do for you.
9:54 am
9:55 am
one of my big things for this spring is the relating of the industrials. meaning they're going to see better than expected numbers. parker hannifin with a buy. is this when you slap a buy on? shouldn't it have been lower? they're saying it's going to be a surge of industrial production and they want to find ways to play it. is going to be the one that's most synergistic with industrial production going higher.
9:56 am
this is the trade a lot of hedge funds are making. they want to be in the classic industrials betting for a turn and then perhaps betting for repatriation and betting for lower taxes which by the way united technologies said would be huge for them. >> we're going to get ip data on friday. >> yeah. >> what's tonight? >> one of the most exciting companies i follow is u.s. concrete. why is u.s. concrete exciting? they put a bid in for the wall. they want to make the wall. and, you know, obviously when we say the wall, we all know what we're talking about. u.s. concrete is a gigantic company. very big in brooklyn. doing the google headquarters. they're doing a lot of great stuff, la guardia. they want that wall contract. it is a big piece of business. >> biggest ever. maybe after the chinese great wall. >> that's a big one. have you ever been there? >> no, is it really something? >> you got to go. >> really? darn. >> they didn't have nearly the tech we have now. >> no. >> it worked, right? people were a little smaller
9:57 am
then. >> yes. >> they were, they were like 4 feet. they were like 4 feet tall. i'm not kidding. >> we'll see you tonight, jim. mad money, 6 p.m. when we come back, we'll dig deeper into the gop's obamacare plan. douglas holtz-eakin and douglas elmendorf.
9:58 am
9:59 am
finally. hey ron! they're finally taking down that schwab billboard. oh, not so fast, carl. ♪ oh no. schwab, again? index investing for that low? that's three times less than fidelity... ...and four times less than vanguard. what's next, no minimums? minimums. schwab has lowered the cost of investing again. introducing the lowest cost index funds in the industry with no minimums. i bet they're calling about the schwab news. schwab. a modern approach to wealth management. is happening before our eyes. shift in human history sixty to seventy million people are moving to cities every year. at pgim we help investors see the implications of long term megatrends like the prime time of urban expansion, pinpointing opportunities to capture alpha in real estate, infrastructure and emerging markets.
10:00 am
partner with pgim the global investment management businesses of prudential. good monday morning. welcome back to squawk on the street. take a look at the markets. dow's down about 25 points. caterpillar leading. crude oil once again continues the weakness. got down to 48.11, the lowest since november. >> our road map for the hour begins with wall street's top cop getting fired over the weekend after refusing to step down. re, an from a former u.s. attorney general, alberto gonzal gonzales, coming up. >> results are mixed from the fomc meeting on thursday.
10:01 am
>> plus, intel announcing it's buying mobile eye. new details on the deal, straight ahead. >> the president asking 46 federal prosecutors to resign and firing preet bharara after he refused. our eamon javer rs with more on that. >> they're not commenting this morning about events over the weekend. starting on friday when the trump administration sent a notice to all 46 presidentially appointed u.s. attorneys telling them they needed to submit letters of resignation. there was confusion in preet's camp on friday night whether that aplied to him. he said he met with the president and the attorney general and had been given orders to stay on for the southern district of new york. that apparently not the case on saturday. dana benta, the acting deputy attorney general, called preet bharara on saturday. they had a conversation where it
10:02 am
went back and forth. benta saying you in ing you ne your resignation. neither side coming to any agreement on whether he was fired or not fired. at the end of the call, bharara put out this tweet in which he said he was fired. saying i did not resign, i was fired. being the u.s. attorney in the southern district will be the greatest honor of my professional life. there was this tweet on sunday from preet as well. a lot of analysis about what this one means. he said, by the way, now i know what the moreland commission must have felt like. the moreland commission was an anti-corruption effort that was shut down, many felt prematurely, before it had an opportunity to finish its anti-corruption work. some question there whether preet was hinting that he had some anti-corruption efforts under way that were now stymied as a result of his firing by the trump administration. no comment on that today from
10:03 am
the white house or the department of justice, carl. >> all right, eamon, thank you. preet bharara met with then president-elect trump just weeks after the election. here's what he said after that meeting. >> the president-elect asked presumably because he's a new yorker and is aware of the great work our office has done over the last seven years, asked to meet with me, to discuss whether or not i'd be prepared to stay on as united states attorney to do the work as we have done it, independently, without fear of favor, for the last seven years. we had a good meeting. i said i would absolutely consider staying on. i agree anned to stay on. >> now that we know that's not the case, joining us on the phone this morning, cnbc contributor former assistant u.s. attorney general john karlen is now chair at morrison and forrester. it's good to have you back, thanks for joining us. >> thank you. >> take your temperature on all of this. do you see anything unconvent n
10:04 am
unconventional about this or is this run of the mill? >> well, look. well, u.s. attorneys serve at the pleasure of the president. there's -- and at the beginning of an administration. there's a history of replacing u.s. attorneys. the circumstances of having asked the u.s. attorney to stay on tell them you're going to keep them on, try to reach them by telephone, as has been reporting a day or two before firing them, is unusual. >> so what do you think, john, he meant by -- i think you know mr. bharara pretty well. what do you think about that tweet about the moreland commission, now i know what the moreland commission must have felt like? >> well, look, i can't speculate as to what was on the plate of the u.s. attorney's office in the southern district of new york. but one of the reasons why u.s. attorneys have been in a position where they made changes in the beginning of the
10:05 am
administration but not changes during an administration except for cause is because of the importance of the independence of the u.s. attorney. they're relied upon to pursue cases ranging from corruption to national security investigations of the highest order. under preet's watch in the southern district, i know both as someone who's lived in new york and his family in new york, was grateful for the work of that office, great partner to the national security division, going after cases ranging from the spokesman for al qaeda to the times square bomber and in every instance, the number one concern is what was best for the case, what would keep the people safest. they're a wonderful partner. i hope we all take a moment to appreciate the great work we did, whether it is terrorists or
10:06 am
corruption cases. >> as it relates to wall street, would you imagine hedge funds and banks are saying about the fact he's gone and his would be replacement? >> i think we'll have to wait and see who the replacement is. circumstances surrounding this removal from the office makes it all the more important to scrutinize very carefully whoever's put forward and whether it comes to without fear of favor pursuing those who violate criminal laws related to fraud, corruption, protecting us against national security threats, to make sure it's a person of the highest caliber. that said, the career prosecutors in that office are top notch and i hope and expect they will get the leader they deserve in terms of the next nominee. and that they'll continue to vigorously pursue cases along with the federal law enforcement agencies in new york.
10:07 am
>> what do you think, john, is next for mr. bharara himself? >> i just know he's someone of incredible talents and work ethic. and one way or another, he continues to work, to serve the public. >> you think that's what he's signaling by making these tweets pretty public? >> well, i don't know about this world of tweets and twitter. but, he's someone who has tirelessly worked and had deep respect of the agencies he worked in and i think across party was someone known to follow the facts and the law aggressively and i hope he brings that same drive to whatever endeavor he takes on next and i hope it's something
10:08 am
he continues, to serve the public. >> certainly high profile because of his position and also because of his personality. we'll keep our eye on him and his next chapter. good talking to you. >> thank you. >> john carlin. joining us a little later on this hour, someone who knows firsthand the political fallout from the firing of u.s. attorneys, former u.s. attorney general alberto gonzales. when we come back, the cbo getting ready to release its report on republican plan to overhaul health care. we'll talk to two former cbo directors, doug holtz-eakin. plus, getting ready for a rate hike. the fed kicking off its two-day meeting tomorrow. how investors are preparing.
10:09 am
10:10 am
10:11 am
the congressional budget office expected to release its report on the proposal as early as today. what to expect on abc's "this week" yesterday morning. >> if the cbo was right about obamacare to begin with, there would be 8 million more people on obamacare today than there actually are. love the folks at the cbo. but sometimes we ask them to do stuff they're not capable of doing and estimating the impact of a bill of this size probably isn't the best use of their time. >> joining us, the american action forum president, former cbo director, and doug
10:12 am
elmendorf, also a former cbo director. it's good to have you both. good morning. douglas holtz-eiken, that line about not the best use of their time. he later on tweeted the former omb director in me is speechless. are you? >> it's their job. it's not a waste of their time. it's their job to inform the congress of the budgetary consequences of the decisions they're making. so what cbo will do today is deliver that information. >> but is there some limit to bill size or idea size beyond which their capabilities go? >> no. in my time, i have scored bills that are one page long and renamed post offices, that's not very expensive. we did the medicare modernization act. the prescription drug bill. enormous bills. dodd/frank, affordable care act. there's no limit on the kind of activity the cbo needs to do. >> doug elmendorf, you a degree? >> it's clear that bigger more
10:13 am
fundamental changes in policy are more difficult for cbo to score accurately. and nobody is more aware of the uncertainty of cbo's predictions than doug and i and the analysts at cbo. but that's not a reason to ignore estimates altogether. and cbo's predictions for the affordable care act were more accurate than a lot of people's random guesses seven years ago. >> so doug, let's talk about what we can expect from this report. republicans need to pass this thing through a budget process called reconciliation for it to qualify. the bill needs to save the federal budget at least $2 billion over ten years. do you expect it to make the cut literally? >> yes, i do. in fact, that's the primary purpose of the cbo report. if it comes out today. is to make sure that the bill satisfies the requirements for wrereconciliation protections. there will be a lot of attention paid to the supplementary
10:14 am
information that comes with that report largely on the coverage of people with health insurance and perhaps some information on premiums as well. >> so what do you think it is, that the white house is already trying to pour cold water on the cbo? what are they worried about to come out of this report? >> clearly worried cbo will show a sharp decline in insurance coverage under the proposed legislation. they're trying to reduce cbo's credibility and they're trying to redirect attention away from the effect on insurance coverage through the comments that speaker ryan and others have been making. >> you admitted you were off when you ran cbo in terms of estimating how many people would have coverage under the aca. is the criticism fair for them? should we perhaps view whatever number they come up with some suspicion? >> i don't think we should view it with suspicion. there's a certainty ban around the particular point estimate. that cbo writes down.
10:15 am
we talked in 2010 when we worked on the estimate originally. doesn't mean there's no information in the estimate. cbo projected originally the affordable care act would cut the number of uninsured people from about 50 million to 21 million in 2017. cbo now thinks that will be 27 million in 2017. it's not as low as cbo thought but it's a lot loren that the level of uninsurance would be without the affordable care act. >> if i could weigh in on that. >> i yeah, go ahead. >> in this bill, there's a stabilization fund that's out there for, you know, $15 billion in 2018, $10 billion a year for the years after that. that's given to states. states have an enormous amount of flexibility. they can re an dues the out of pocket expenses for individuals. any of those actions would have a big impact on premium costs and thus enrollments.
10:16 am
how can cbo have an estimate? recognize there's going to be an estimate, they have to produce one. but there's a lot of uncertainty. depending on what evolves in the years to come. >> how is politics going to play out with this then? 15 million seems to be a magic number. if the coverage declines in ryan's plan. regardless of whether that number's accurate. to the point you're both making, is that going to affect the politics here? >> i don't think it effects it a lot to be honest. the score comes out. the democrats say we hate this bill. it's the worse thing that ever happened. republicans are going to look at it and say there are things in here i don't like and it's not perfect and that was true before and it's going to be true after. it's still their responsibility as governor. not much really changes. >> doug, to this larger point about it's an estimate, it's
10:17 am
uncertain. a lot of viewers take that as code for just wrong. isn't there some layer of the cbo that is just a political tool at this point? >> no, i don't think so. the cbo will produce an estimate about this legislation like others. their will do this in an objective and skilled way. they were created as an agency to play exactly this role. i disagree a bit on this, i think the politics will be affected because i think cbo will show clearly a decline in insurance coverage and will show clearly substantial federal subsidies continuing for health insurance. and that will tend to diminish enthusiasm on both the left and right of the republican spectrum for the legislation. i think having the numbers in black and white will make it more difficult to move the legislation. >> i wonder, doug elmendorf, what the threshold is that senate republicans will be comfortable voting for when it
10:18 am
comes to the number of uninsured. >> i don't know. i don't know what the threshold is or if there is a magic threshold. each individual member will have to make up his or her own mind to some extent. my view is any double digit lost of insurance coverage, anything 10 million or more, is a big loss. those are a lot of people who will not have health insurance. think that's going to be a larger political problem once the number's written down in black and white. >> guys, we appreciate that. we will obviously watch to see what the numbers are. hope to talk to you soon. thanks. we have some deal news. intel announced it's going to buy mobile eye. the deal price around $15 billion. that's $63.54 a share all cash. going to pay that off its balance sheet. it has a lot of cash there. let's talk to john ford about the strategy behind this, intel's decision here to make clearly into what it says is the
10:19 am
data center of the future, namely one that has four wheels. >> yes, but whose data is it is part of the question. this is a huge deal for intel. intel's biggest of the modern era at $17 billion. so not that much smaller than that. part of intel's reasoning behind this, as they say in their press release, they expect cars to generate four terabytes data per day. the question is whose data is that? or does intel get a share in that data to get smaller about how cars see the road, about what people want in their cars, cars have become entertainment centers as well as vehicles that get us from place to place. of course self-driving is a part of this. >> but mobile eye obviously their technology is specific to the autonomy of the car itself. >> it is, and that's how intel is pitching this. allows the car to see the road. it's got collision avoidance. it deals with self-parking.
10:20 am
it deals with staying in the lane. but this also lines up with some other things that intel has been working on outside of the car. like its real sense technology. the pc can see you. recognize your face. to me more broadly it has to do with computing. getting smarter about integrating with the world without having to rely on you to make decisions along the way. this is a clear departure from intel's legacy as a pc company. >> who's their biggest competitor on that front? >> nvidia. but also some traditional automotive names. boesh, delphi, et cetera. lots have smaller pieces of what mobile eye has tried to put together. mobile eye has put so many of these technologies together and done it well. the danger is the car companies don't want to turn into pc companies. they don't want to turn into gray box makers of the future. we'll talk about all of that with intel ceo who will downus next hour. >> i remember when they went
10:21 am
public on the new york stock exchange and that whole contingent from israel. the stock has been very strong since then. >> it's been up and down. if you take a look, the stock is actually traded i think around the levels where intel wants to buy it now. though mobilized board has already agreed to this price. intel likes it. we'll see if it comes through. they're making this scale. remember, qualcomm bought nsp also. we have the next generation of chip boards brewing right here. >> see you next hour, big interview. coming up, news out over the weekend sending shockwaves through wall street. preet bharara getting fired. coming up, the next down week for stocks in the last seven. it looks like minor losses for the dow and the s&p. the nasdaq remains positive.
10:22 am
the power of a low volatility investing approach. the power of smart beta. power your client's portfolio with powershares. before investing, consider the fund's investment objectives, risks, charges and expenses. call 800-983-0903 for the prospectus containing this information. read it carefully. distributed by invesco distributors inc.
10:23 am
containing this information. read it carefully. hey nicole. hey! i just wanted to thank your support team for walking me through my first options trade. we only do it for everyone gary. well, i feel pretty smart. well, we're all about educating people on options strategies. well, don't worry, i won't let this accomplishment go to my head. i'm still the same old gary. wait, you forgot your french dictionary. oh, mucho gracias. get help on options trading with thinkorswim, only at td ameritrade.
10:24 am
some big events for the markets this week. followed by policy announcements from both the bank of japan and
10:25 am
the bank of england. to weigh in on all of this, we're joined by the chief global investment strategist. and anthony chan, chief economist at chase. how do you brace for this biggest for stocks after the stunning surge we've seen over the last few weeks post election? the fed, the dutch election, and a number of others coming this week? >> yeah, there are a number of these risks. we recommend focusing on u.s. equities over international. a lot of these risks are concentrated open international markets. whether you've got nafta renegotiations beginning about 90 days from now. you have merkel talking about nato spending and trade. a number of issues they might crash. and then the netherlands election. a lot of risks in the market from a policy and economics standpoint over the coming
10:26 am
months. so this week can set the tone. we'll see whether stocks are down again. we expect volatility in the weeks ahead. >> you like to stay in the u.s. for safety. >> yes. stay in the u.s. and look at large caps in the u.s. i know you normally want small caps if you're worried about trade. i don't think trade is the big issue here. i think we could see some volatility and the small caps. >> so anthony, the fed is certainly going to be a biggie. even though there's a rate increase priced in, do you expect the fed to change its tone when it comes to the pace of future interest rate hikes? >> i think that's a risk. right now, this is like the perfect opportunity for the federal reserve to do this with the soft data and hard data really suggesting a rate hike would occur. but right now, everyone,en cluding my pet chihuahua, is including a rate hike so i think the fed doesn't have to worry about that. moving forward, this week is critical. as jeff mentioned. we know that angela merkel is meeting on tuesday.
10:27 am
the g-20 of course is on the weekend. for in, this is good news. i think it will give an opportunity for washington to moderate some of that negative concern the market had about trade. with angela merkel coming in and the g-20, it will temper that negative tone of trade. that's the reason why the large caps are outperforming. the small caps, they've lost the gains for the year because when we were worried about trade, that benefits the small caps but hurt the large caps. we're seeing the reverse now. >> it is interesting to look at that. justin the fed, if they do remove the language, gradual rate hikes and sort of respond to the improved outlook we've seen in the markets and the economy, is that a risk that they spoil the party? >> well, it's a risk they go for rate hikes. i think the market could tolerate three rate hikes. four rate hikes would be a little bit problematic insofar as it tells you something about 2018. by the way, it's not just the federal reserve. the european central bank
10:28 am
telling us no sense of urgency in trying to worry about deflation or low levels of inflation. so it's central banks around the world. bank of japan is going to follow in those same foot steps. just a little bit less moving forward. >> it took a while that expectations go from 50 to near 100. is it going to be the same dynamic where the markets are dragged kicking and screaming into believing it's four instead of three or normalization happens this year instead of next year? >> yeah, we'll see, right. so the market will be trying to figure out. it's only been three months since the last rate hike. and then with what does it look like just a we're from now when there's likely a new one for the fed. the outlook for the ecb is in question. rates are moving higher. even a chihuahua could predict that as well. i think that's the key issue. how much higher are they likely to go. i think right now with economic
10:29 am
data, relatively robust, both here in the u.s. and in europe, the market's okay with a tapering of q/e. and if that data begins to fade, they may not be as comfortable with it. and that may determine the pace the fed and other central banks can pull back from stimulus. >> last word, scottish referendum, dutch election on wednesday. how much does this threaten to interfere with that outlook? >> i'm not worried about a dutch election. even if he comes in first, which is now open to question, all the other political parties are saying they're not going to form a coalition. in the dutch elections with that political party. you're not going to necessarily -- >> that's the anti-eu -- >> but what i'm worried more is in france where marie le pen has more.
10:30 am
there's a good chance in the second round you won't get marie le pen also. >> that first election in france coming in april. we'll leave it there. >> it's about half past the hour. let's get over to sue herera and get an update. >> here's what's happening at this hour. the winter storm that is predicted to bring heavy snow to millions on the east coast starting tonight has already brought strong winds and snow to the midwest. the nor'easter is expected to bring up to two feet of snow to the new york and new england regions and blizzard-like conditi conditions. turkish president erdogan has called on international voices to raise their voices against the netherlands after a dispute this weekend. he says the netherlands should face sanctions for barring his ministers from speaking in roddenham. seeking authority to seek a new independence referendum in the next two year because britain is dragging scotland out of the european union against its will. she said it will be held between
10:31 am
the fall of 2018 and the spring of 2019. and march madness is under way. it could be a distraction in the workplace. a new study shows lost productivity from the tournament will cost employers about $2 billion. the study also shows participation and filling out brackets boosts morale. so i guess that is the tradeoff. not that we'd be watching or anything like that. back downtown to you guys. >> all right, sue, thank you very much, sue herera. when we come back, really truly arrogant. that's what our next guest is calling preet bharara after refusing to step down. former attorney general alberto gonzales is with us next. kevin kevin kevin kevin kevin kevin kevin kevin
10:32 am
kevin trusted advice for life. kevin, how's your mom? life well planned. see what a raymond james financial advisor can do for you. i'm vern, the orange money retirement rabbit, from voya. i'm the money you save for retirement. who's he? he's green money, for spending today. makes it easy to tell you apart. that, and i am better looking. i heard that. when it's time to get organized for retirement, it's time to get voya. e*trade's powerful trading tools, give you access to in-depth analysis, and a team of experienced traders ready to help if you need it. it's like having the power of a trading floor, wherever you are. it's your trade. e*trade i am a first responder tor and i'emergencies 24 hours a day, everyday of the year. my children and my family are on my mind when i'm working all the time. my neighbors are here, my friends and family live here, so it's important for me to respond as quickly as possible and get the power back on. it's an amazing feeling turning those lights back on.
10:33 am
be informed about outages in your area. sign up for outage alerts at together, we're building a better california. the firing of preet bharara over the weekend sending shockwaves over wall street. >> hey, david, that's right, when wall street hears the name
10:34 am
preet bharara, one of the main things they think about is insider trading catione ing cas. some of his most high profile involved one given the longest ever sentence for insider trading. as well as sac capital, the hedge fund, which was fined $1 billion, the largest penalty ever for insider trading. his track record was quite unprecedented with regard to insider trading. 111 insider trading charges. 89 of those resulted in convictions. but seven cases are still pending. and one of the big questions on wall street right now is what happens to those pendi ing case. joon kim has stepped up as u.s. attorney. longer term, the plan is more of a question mark. >> no matter, those cases will continue to go forward. but regard to the number of high-profile cases, you have to deal with the fact that preet
10:35 am
was a very hands on prosecutor. so it has an impact. >> that was randal jackson, a former u.s. assistant attorney for the southern district of new york. he said regardless of who takes over that office, they will continue to focus on white collar crime, guys. >> all right, thank you, lesley picker outside the southern district in downtown manhattan. we're joined by the former u.s. attorney general of the united states alberto gonzales. now dean of the law school at belmont university. judge gonzales, nice to have you this morning. >> good morning. >> what's more unusual for the president to ask for the resignation of 46 u.s. attorneys or for one of them to say i don't accept that request? >> i think clearly the latter. obviously, they all serve at the pleasure of the president. if the president no longer has
10:36 am
pleasure in your service, than you're expected to leave. particularly at the beginning of the administration. this is the kind of thing that happens all the time. the attorney general and the president, they want their own u.s. attorneys out there. and while preet had done remarkable service on behalf of this country, it doesn't matter in connection with the political appointee if the president wants to make a change, he can make a change for no reason, for bad reasons. it's just the way it's always been. >> yeah, or make a chance apparently reversing a decision he made a few weeks ago, we're looking at a picture right now of mr. bharara where he spoke about after a meeting at trump tower with the president elect being asked to stay on and he indicated he would be willing to stay on. is it unusual do you think for a president to change his mind about something like that in a relatively short period of time? >> i don't know if i can comment as to how unusual it may be. you know, obviously, at the time, they didn't have a
10:37 am
confirmed u.s. attorney. the u.s. attorney will have a say who he wants -- i mean the attorney general will have a say as to who he wants as u.s. attorney. but irrespective of that, there may have been very solid assurances given the time. circumstances change, personnel change and the president is certainly entitled to make the change if he feels that's appropriate. >> it's cics wonder whether in fact there were some investigations being undertaken by that office that were involving the president or critical of the president. is that a possibility here? is that an area the president should then therefore stay away from? >> well, i can't speak to what's going on in that office so obviously there is a possibility of that. but i think i'd like to reassure your viewers that, you know, their career prosecutors are very much involved in these cases. to the extent there's evidence of wrongdoing, the investigators will continue their work. in the event that evidence shows
10:38 am
that a crime may have been committed, then the career prosecutors will have a big say in whether or not they should follow up with the prosecution. so i, you know, these offices are built to operate without a confirmed u.s. attorney. and i have every expectation that would continue to do the work on behalf of the american people. >> you resigned back in 2006 amid some controversy over this very issue, removal of u.s. attorneys. i know you were cleared of aniening wro doing. senator schumer and preet by his side leading the charge. i just wonder how you reacted knowing all of this weekend news flow, any sense of irony? >> well, i must admit, i thought it was somewhat ironic. preet was very much involved working with senator schumer and trying to come after me, trying to raise the specter that the u.s. attorney removals were improper and as you indicated, they were fully investigated and
10:39 am
nothing was found to be improper about removals because they are, in fact, political appointees. if anyone knows -- if anyone knows about u.s. attorneys and the possibility of the removal by the president of the united states, it will be preet, based on that history? the other issue, because of your knowledge in the past, there's some buzz about mark mucasy, a former prosecutor, ally of rudy giuliani, his father replaced you as u.s. attorney general. what are you hearing on that front? you think he'd make a good candidate? gli don't know, you know. i don't know much about mark or his experience. i haven't personally heard that much about it. if he's anything like his father, i think i would have to say that he'd make a fine u.s. attorney. >> that will be a decision in the hands of attorney general sessions and president trump. >> where is u.s. attorney
10:40 am
general sessions? do you think he should be more public about this, more out there, when it comes to -- you know, preet's sort of controlling the narrative. >> i don't think there's a need for the attorney general to be out there. at the end of the day, this is a presidential appointment and removal. and so the fact that any comments are coming out of the white house would not be unusual. so no, i don't have a problem with general sessions focussing on other important work on behalf of the american people. >> finally, judge gonzales, apparently there was a phone call made from the white house to preet bharara on thursday. he didn't actually take the call. is that unusual? and is that -- did he act appropriately and not actually speaking with the president? >> well, i don't know what preet knew at the time. i don't know the purpose of the call. i don't know who made the call. so there's all kinds of unens anned questions that make it difficult for me to respond to your question.
10:41 am
i just don't know. >> neither do we. but, judge, we appreciate your insight this morning, thank you. >> you bet, thank you. >> judge gonzales joining us. take a look at shares of mobile eye this morning. up about 14%. intel buying the tech company in the biggest tech deal of the year. we're going to talk to intel's brian krzanich. back in a minute. ( ♪ ) it just feels like anything is possible here in upstate new york. ( ♪ ) at corning, i test smart glass that goes all over the world. but there's no place like home. there's always something different to do like skiing in the winter, jet skiing in the summer.
10:42 am
we can do everything. new york state is filled with bright minds like samantha's. to find the companies and talent of tomorrow, search for our page, jobsinnewyorkstate on linkedin. search for our page, the markets change... at t. rowe price... our disciplined approach remains. global markets may be uncertain... but you can feel confident in our investment experience around the world. call us or your advisor... t. rowe price. invest with confidence. experience exciting offers on sales event is here. our most thrilling models ever. get up to $2,500 customer cash on select 2017 models for these terms. experience amazing at your lexus dealer.
10:43 am
a classic market indicator breaks down his charts and reveals where he thinks stocks are going next. john bollinger at more squawk on the street coming up.
10:44 am
the dow down 35 points. let's get out to the cme group. >> good morning, thank you. i'm going to welcome my guest charles beaterman. we all know he's one of the best
10:45 am
when you want to follow the money. but don't follow him from hawaii to new york on this particular date on the calendar. charles, you should be in alohaville. let's talk about flows. three categories. just general net in flows or outflows for equity, corporate flows specifically and insider. i want you to weigh in on those three channels. >> so far, we're seeing huge inflows into u.s. equity etfs. a lot more than the smaller outflows from u.s. equity mutual funds which continue. and parenthetically, the bigger inflows into global equity etfs. without those inflows, i don't think the market would be up this year. why? because corporate buying has slowed dramatically year over year. there have been reports that insider buying has slowed. and at multiyear lows which is true. but it's also -- it's insider, net insider selling.
10:46 am
net insider buying is down 70% year over year. and announced corporate buying. companies announcing buybacks, cash takeovers, net of all new share sales is down also. down two-thirds from the same period a year ago. in other words, we're seeing companies which have been the main source of capital for taking this market higher have dramatically lowered their buying at the same time as we're seeing huge inflows buy individuals. >> so let's really get at that because embedded in that relationship is what investors really need to know. there were many years where you, maybe the first to say it, that one of the main issues, off shoots, of fed policy was all the kind of cheap money that could boost the prices of stocks as companies bought back their shares. that being down, is it offset enough by the net inflows and the etfs you referenced?
10:47 am
>> so far. the key is will the actual underlying economy keep improving so that they'll be enough income being generated to continue inflows into stocks. that's the key question. >> well, unfortunately, the answer to that in large part may lay in politics. and that's never easy to divine. in the last 30 seconds, we need to keep it tight, give me your outlook on how legislation will move through. >> my concern is obamacare repeal and recasting will bog down and slow everything and the important parts of the agenda that you and i both would love to see, less regulation, much more tax efficient or cost effective infrastructure building, tax code, tax code becoming a tail wind instead of a head wind. all those things could be delayed if this obamacare thing
10:48 am
gets bogged down in congress. so the question to me is will -- without these legislative improvements, i don't see this economic rebound lasting very long. and so the market -- key to the market going forward is can they actually get the agenda through congress? >> and that is the trillion dollar question. charles beaterman, thank you, i hope you make it back to hawaii soon. sara, back to you. >> all right, rick, thank you. coming up, we'll tackle one piece of that legislation agenda. one of the most powerful lobbying groups in the u.s. opposing the gop health care bill. we'll talk to the director of legislative policy for aarp next. so what else is new? how's your mother?
10:49 am
umm..she's doing good. she needs more care though. she wants to stay in her house. i don't know even where to start with that. first, let's take a look at your financial plan and see what we can do. ok, so we've got... we'll listen. we'll talk. we'll plan. baird. and her new mobile wedding business.tte
10:50 am
at first, getting paid was tough... until she got quickbooks. now she sends invoices, sees when they've been viewed and-ta-dah-paid twice as fast for free. visit quickbooks-dot-com.
10:51 am
the debate over health care continuing as the cbo reviews the gop's proposal estimating its potential costs. the bill's come under fire by groups like the aarp, who say the plan introduces an age tax targeting older americans. joining us this morning, the legislative policy director and legislative counsel at the aarp. david sturgis. good to have you with us. >> thanks for having me here. >> we know the group is no fan of this idea. is the cbo result going to have
10:52 am
any sway with you whatsoever? >> well, i think the cbo will put clearer numbers on what we've been saying, which is that this bill will lead to dramatic increases in premiums for seniors, particularly those between 50 and 64. >> is that true across the board? i mean, i keep seeing cherry-picked examples of an elderly person making $18,000 and how the cost of premiums could exceed his annual income, but what about the broader part of that bell curve? >> well, basically, the older you get and the lower your income, the bigger the premium increase you're going to see. so, if you're a person that's $60,000 or $25,000 of income, you'll see a premium increase of over $5,000. if you're 64 with $15,000 of income, you're going to see an increase of over $8,000. so, really, the older and poorer you get, the bigger the impact is going to be of this health care bill on your premiums. >> so, if your main gripe is with the premium increases, isn't that exactly what obamacare did, legislation that you guys did support? >> well, actually, the problem was that people couldn't get
10:53 am
health insurance because of pre-existing conditions and something called age rating. this law limited how much more insurance companies could charge seniors. and now the repeal here of repeal and replace is going to take that limit and boost it to allow insurance companies to charge five times as much. but not only are insurance companies able to charge people more, the amount of tax credits available to seniors is going to go down. so there's a double whammy. and that's why the math is working this way. if you're older with less income, you're going to get hit very hard with this bill. >> republicans would counter that by saying everyone will have more choices, it will be more market-based, and therefore, costs for everyone will eventually come down. >> well, i don't think you can argue with the math here. it doesn't matter if you have more choices if they're all unaffordable. and what we're seeing, between age rating and loss of tax credits, is a huge what we call age tax that people will just not be able to afford their insurance. >> so, you're not a believer in the idea that more choices, more competition, lower price? that does not follow for you?
10:54 am
>> well, more choices is certainly great, but we also have math here, and if you let insurance companies charge people a lot more money and you give people a lot less in tax credits to afford it, it's not really going to matter how much choice you have. you're just not going to have affordable. you're not going to have competition that's going to bring those prices down enough to make up for what you're losing today. >> what's your assessment of what will happen if obamacare continues to exist? does it, in fact, collapse into itself? >> i don't think it's collapsing, but we all know that we can make changes to improve obamacare. and if you think about what everyone's been complaining about over the last couple of years, it's been the fact that their premiums have been going up and there's not enough competition. we don't see anything in this bill that actually helps brings premiums down. in fact, for our folks, we actually see huge price spikes, so we think this bill is going in the wrong direction. we think we can make corrections to the bill to help stabilize the market, broaden the risk pools, but what they're doing we think will result in the opposite. >> and how, david, do you respond to criticism from those
10:55 am
who say you supported obamacare, you're just acting politically here? >> well, we supported obamacare because it helped actually provide affordability for the 50 to 60-year-old population. that was one of the key issues for us, and this bill now with repeal is going to reverse those gains. we've seen since the enactment of obamacare a drop of the number of uninsured by half. we think those gains could be erased if we go ahead with this repeal and replace bill that's on the floor right now. >> where do you focus your efforts in terms of turning your votes your way in let's call it the house or the senate? who is most vulnerable here in terms of you prevailing, so to speak, with your point of view amongst your elected representatives? >> right now, one of the things that concerns us most is i don't think people fully appreciate how huge these premium increases are. as you know, we don't have the official scorekeeper yet, the congressional budget office coming out with numbers, so those official numbers aren't out, but the numbers that we have run and that others have run are really suggesting these premium hikes are much bigger
10:56 am
than people understand. and so, we right now are in the process of not just educating our members and the general public, but also educating people on capitol hill who for years have been lobbying about the problems being high premium costs and now they're moving in the opposite direction and actually raising them further. so, we think we have an education responsibility to let people know what the real negative impacts of this bill will be. then we'll be basically targeting the house and senate in their entirety, because quite frankly, these premium spikes are going to affect people all across the country. so, in every state in the union, people are going to have negative premium effects. >> david, obviously, the markets for our purposes are trying to read this closely. we hope you'll stay close. thanks a lot. >> thank you. >> david certner with the aarp. as we head to break, shares of mobileye are up 30% as intel announces a deal to buy the provider of autonomous driving technology for over $15 billion. intel, by the way, biggest loser in the dow.
10:57 am
ceo brian bkrzanich will be joining "squawk alley" in an interview you will not want to miss.
10:58 am
10:59 am
11:00 am
welcome back to "squawk on the street." i'm seema mody. energy stocks are holding on to slight gains, making it one of the top-performing sectors in the s&p 500, this after falling under significant pressure last week in response to the sharp decline in wti crude prices, which are currently hovering around $48 a barrel, a three-month low. names leading the sector higher today include chesapeake energy, southwestern energy and marathon petroleum, all up about 2%. the sector, though, still the worst-performing sector year to date. now let's send it back to carl and the gang for the start of "squawk alley." >> all right, seema. thank you very much! it is 8:00 a.m. at santa clara headquarters of intel. it's 11:00 a.m. on wall street, and "squawk alley" is live. ♪


info Stream Only

Uploaded by TV Archive on